Here’s a sobering fact: Just under half of all Canadians have made a Will.1 That may seem like a shocking number given how detrimental it is for a family if a breadwinner dies without one. But for those who have taken the time and effort to make one: Congratulations, you’re ahead of the game, but the job is not complete. According to Domenic Tagliola, a Tax and Estate Planner with TD Wealth, updating your Will as events dictate is an ongoing responsibility to yourself and your family. If your Will is out of date, it can cause delays, conflicts between family members and hardships if funds meant for your loved ones are held up in court for years.
“Circumstances change. How you think about transferring your wealth and who it will go to will be different at age 30 than when you’re 70,” he says. It’s why he recommends updating your Will every three to five years. “Laws change, people change, wealth grows, and your outlook shifts as you walk through life. Your Will has to catch your intentions and wishes, not from 25 years ago but right now,” Tagliola says.
If it’s been a long time since you thought about the content of your Will, here are five triggers that may signal it’s time to update it.
1) When a child turns 18
“When your children reach the age of majority, they can receive your assets as adults — that’s the top reason to review your Will,” says Tagliola. When children are minors, one purpose of a Will is to appoint a guardian to your children and also to arrange a trust for their assets. But by the time they reach 18, your assets have likely grown substantially. Your children may no longer need a guardian but there can still be a need for a trust for any funds they might inherit so that they don’t receive large sums of money all at once. Many parents may even prefer setting up a trust for mature adult children: If the children have complicated financial circumstances, parents may wish to keep the funds out of the hands of ex-spouses or creditors.
2) When your executors and administrators grow old
Many people appoint relatives to be executors, guardians, accountants and trustees for their children. However, as those people grow old you may wish to re-evaluate and appoint new people. After all, you don’t want an executor to pre-decease you, or you may also want your children to be executors at some point. Secondly, as people get older, their financial affairs might become complicated. You may wish to have a more competent executor handle your affairs or even a professional, says Tagliola. Many people turn to a trust officer from a trust company to be the executor. While there is a cost, a trust officer brings expertise and experience to the disbursement of the Will and can be a neutral party if there are any disagreements among beneficiaries.
3) When someone gets married…or divorced
Needless to say, family affairs can get complicated, but your Will must reflect your intentions no matter your situation or any bumps along the family road. This can of course include a marriage breakdown, a second marriage or a common-law relationship. Tagliola points out that a second marriage by either spouse invalidates any previous Will: Any earlier provisions for children are suddenly undone. He also points out that, depending on the province you live in, a common-law relationship can also complicate estate planning since, in some provinces, these relationships are not recognized. That means in some cases a newlywed of one day could be entitled to more rights within family law than a common-law partner of 40 years. These discrepancies need to be reviewed and adjustments made to the Will if someone wants to ensure their loved ones are looked after. Relying on what you believe the law will do can be a costly mistake, says Tagliola.
4) When you retire
Since your financial situation changes when you retire, Tagliola recommends reviewing your Will with an eye toward alleviating any taxes your estate would be required to pay when you pass on, including probate tax. At this stage, you may choose to make a gift of real estate and other personal affects to your beneficiaries. Giving assets away to family members while you’re alive, if done properly, can alleviate tax issues, and may allow you to see your loved ones enjoy your gift. Changes to estate planning may also include giving to charities since there can be significant tax deductions if donations are made. Your Will should reflect these new changes to your finances.
5) Whenever laws change
“If there are significant changes in tax law or significant changes in legislation, you have to be aware of that and make plans accordingly,” says Tagliola. He says that the courts have recently clarified some points of law that have helped estate and tax lawyers fine-tune their clients’ Wills. Any change in law could send you back to your lawyer’s or accountant’s office to ensure that your plans can still be carried out. Beyond that, you should probably check your Will every five years just to remind yourself of the content of your plans and to ensure you still feel comfortable with the decisions you’ve made, given the time that’s passed.
Tagliola says the values of assets can change over time. If someone writing a Will promised a daughter a cottage and a son a stock portfolio, the values may have diverged sharply over the decades. The result could create family animosity which is probably the last thing someone would have wanted.
“Only by keeping your Will up to date can you ensure that you’ll be looking after your affairs and family properly,” Tagliola says.
- “What ‘will’ happen with your assets? Half of Canadian adults say they don’t have a last will and testament,” Angus Reid, Jan. 23, 2018, accessed June 17, 2020, angusreid.org/will-and-testament/. ↩
DISCLAIMER: The information contained herein has been provided by TD Wealth and is for information purposes only. The information has been drawn from sources believed to be reliable. Graphs and charts are used for illustrative purposes only and do not reflect future values or future performance of any investment. The information does not provide financial, legal, tax or investment advice. Particular investment, tax, or trading strategies should be evaluated relative to each individual's objectives and risk tolerance.
TD Wealth represents the products and services offered by TD Waterhouse Canada Inc., TD Waterhouse Private Investment Counsel Inc., TD Wealth Private Banking (offered by The Toronto-Dominion Bank) and TD Wealth Private Trust (offered by The Canada Trust Company).
All trademarks are the property of their respective owners.
® The TD logo and other trade-marks are the property of The Toronto-Dominion Bank.
MENTIONS JURIDIQUES : Les renseignements aux présentes ont été fournis par Gestion de patrimoine TD aux fins d’information seulement. Les renseignements proviennent de sources jugées fiables. Les graphiques et les tableaux sont utilisés à des fins d’illustration et ne reflètent pas des valeurs ou des rendements futurs. Ces renseignements ne fournissent pas de conseils financiers, juridiques, fiscaux ou de placement. Les stratégies fiscales, de placement ou de négociation devraient être étudiées en fonction des objectifs et de la tolérance au risque de chacun. Gestion de patrimoine TD représente les produits et services offerts par TD Waterhouse Canada Inc., Gestion privée TD Waterhouse Inc., Services bancaires privés, Gestion de patrimoine TD (offerts par La Banque Toronto-Dominion) et Services fiduciaires, Gestion de patrimoine TD (offerts par La Société Canada Trust). Toutes les marques de commerce appartiennent à leurs propriétaires respectifs.
ᴹᴰ Le logo TD et les autres marques de commerce sont la propriété de La Banque Toronto-Dominion.
免責聲明：本文內之陳述由道明財富 (TD Wealth) 提供，僅供資料說明之用。本文根據相信為可靠的資料匯編而成。圖表僅供解說之用，並不反映任何投資的未來 價值或未來回報。本文資料並不旨在提供財務、法律、稅務或投資建議，衡量個別投資、交易或稅務策略時，應考慮個別人士的目標和風險承受能力。道明財富、道明銀行 (The Toronto-Dominion Bank) 與其聯屬及相關實體對任何資料錯漏或導致的損失或傷害概不負責。道明財富是代表由道明宏達理財加拿大有限公司 (TD Waterhouse Canada Inc.)、道明宏達理財私人全權託管投資有限公司 (TD Waterhouse Private Investment Counsel Inc.) 以及透過道明銀行提供之道明財富 私人銀行 (TD Wealth Private Banking) 和透過加拿大信託公司 (The Canada Trust Company) 提供之道明財富私人信託 (TD Wealth Private Trust) 所提供的 產品與服務。TD Waterhouse Canada Inc. － Member of the Canadian Investor Protection Fund。
® 道明 (TD) 標誌和其他商標是道明銀行的產權。
免责声明：本文内之陈述由道明财富 (TD Wealth) 提供，仅供资料说明之用。本文根据相信为可靠的资料汇编而成。图表仅供解说之用，并不反映任何投资的未来 价值或未来回报。本文资料并不旨在提供财务、法律、税务或投资建议，衡量个别投资、交易或税务策略时，应考虑个别人士的目标和风险承受能力。道明财富、道明 银行 (The Toronto-Dominion Bank) 与其联属机构及相关实体对本文中任何资料错漏或导致的损失或伤害概不负责。道明财富是代表由道明宏达理财加拿大有限公司 (TD Waterhouse Canada Inc.)、道明宏达理财私人全权托管投资有限公司 (TD Waterhouse Private Investment Counsel Inc.)、以及透过道明银行提供之道明财富私人 银行 (TD Wealth Private Banking) 和透过加拿大信托公司 (The Canada Trust Company) 提供之道明财富私人信托 (TD Wealth Private Trust) 所提供的产品与 服务。TD Waterhouse Canada Inc. — Member of the Canadian Investor Protection Fund。
® 道明 (TD) 标志和其他商标是道明银行的产权。